Prices rising as exchanges cut choices
WASHINGTON — Americans in the health insurance markets created by President Obama’s law will have less choice next year than any time since the program started, a new county-level analysis for the Associated Press has found.
The analysis by the Associated Press and consulting firm Avalere Health found that about one-third of U.S. counties will have only one health marketplace insurer next year. That’s more than 1,000 counties in 26 states — roughly double the number of counties in 2014, the first year of coverage through the program.
With insurance notices for 2017 in the mail, families are already facing difficult choices, even weighing whether to stay covered.
“At this point we are at a loss,” said Ryan Robinson of Phoenix. “We don’t know what the next step is.” He and his
wife, Nicole, only have plans from one insurer available next year, and the company doesn’t appear to cover an expensive immune-system medication for their 11-year-old daughter.
Phoenix is the market hardest hit by insurer exits, shrinking from eight carriers to one. With many other communities affected, however, the problem of dwindling choice may create even bigger political headaches than the rising premiums announced last week.
Largely as a result of the Affordable Care Act, the nation’s uninsured rate has dropped to a historically low level, less than 9 percent. But the program hasn’t yet found stable footing, and it remains politically divisive. Insurer participation rose in 2015 and 2016, only to plunge.
Dwindling choice could be a trickier issue than rising premiums for the Obama administration and advocates of the 2010 law, including Democratic presidential candidate Hillary Clinton.
Most customers get financial assistance, and their subsidies are designed to rise along with premiums, which are increasing an average of 25 percent in states served by HealthCare.gov. But there is no comparable safety valve for disruptions caused by insurers bailing out.
“Rising premiums get all of the political attention, but lack of choice between insurers could be a bigger problem for consumers,” said Caroline Pearson, a senior vice president with Avalere.
Five states — Alaska, Alabama, Oklahoma, South Carolina and Wyoming — have one participating insurer across their entire jurisdictions. Only Wyoming and South Carolina had faced that predicament this year.
Citing big financial losses, several marquee insurers sharply scaled back their participation for next year. United Healthcare exited from more than 1,800 counties, and maintains only a minuscule presence, according to the analysis. Humana nearly halved the number of counties where it offers plans.
Insurers say enrollment was disappointing, patients were sicker than expected, and an internal system to help stabilize premiums didn’t work well. The Obama administration says insurers are correcting for initially pricing their plans too low.
The upheaval in the health insurance markets has consumers scrambling to figure out options. Sign-up season starts Nov. 1 and ends Jan. 31.
In Phoenix, Ryan and Nicole Robinson are at the epicenter of the health law’s latest troubles. Maricopa County has seen the most insurers bail out, and premiums for a benchmark plan are spiking 145 percent next year, beyond any other major market on HealthCare.gov.
Ryan Robinson, who works in sales, said the family’s premium will go from $821 to $1,489. But what the Robinsons most worry about is that neither of their daughter’s two medications appears to be covered by the remaining insurer. That includes an immune-system drug costing about $5,000 a month.